“If ye love wealth greater than liberty, the tranquility of servitude greater than the animating contest for freedom, go home from us in peace. We seek not your counsel, nor your arms. Crouch down and lick the hand that feeds you; May your chains set lightly upon you, and may posterity forget that ye were our countrymen.”

this is the only part that's almost true. most of our money was created out of debt because we're using a debt based fiat monetary system.

as individuals, business and government go deeper into debt, the money supply expands.

as individuals, business and governments pay off the debt, the money supply contracts.

but eventually, the debt load becomes too big and impossible to repay and borrowers stop lending when they feel that they wont get paid back.

this is when the federal reserve can come in as the lender of last resort. however, if the Federal Reserve buys debt, that expands the base money supply and is highly inflationary.

so obviously there is a problem with the entire debt based fiat monetary system that we're using. i think mike norman's ideal solution is to have zero taxes, and then the government just prints and spends money to fund government expenditures without going into debt. the problem of course is that this is highly inflationary. people still pay a tax, they just pay it through higher prices (and of course the inflation tax is a very regressive tax). mike norman believes that this will not be inflationary because he believes that when the government prints and spends money, that this will lead to a proportional increase in the amount of goods and services. this is where his argument falls flat on its face. mike norman doesn't understand that there's really no difference between the government increasing the money supply by 10%, and confiscating 10% of everyone's savings, wages, etc. if the government were to print money in this fashion, they would be stealing wealth and capital from the private sector... therefore, any resources that the government spends to create good and services would reduce the amount of resources that the private sector has to create goods and services. he doesn't understand the fact that you can't create real capital with a printing press. the printing press can only transfer capital that has already been created through savings... it transfers capital from savers and wage earners to the people who get to spend the newly printed money (the government in this case). therefore, any additional goods and services created in the public sector would be more than offset by a decline in goods and services created in the private sector.

but mike norman even goes so far as to think that if the government were to print money out of thin air to pay a soldier for example (to go half way around the world and blow stuff up and not actually create any consumer goods or services) ... that this would lead to the greater production of goods and services because the soldier now gets to spend this newly printed money. of course the reality is that you would get fewer overall goods and services produced because of the capital that was stolen from those who earned and saved the money when the government printed more money out of thin air. and now you have a soldier, who produced no good and services, able to consume goods and services that others produced because wealth was transferred to him from those who earned it in the free market.

ironically, guys like webster tarpley actually advocate for a monetary system where the government just prints and spends money (or is loaned money at 0% interest for 100+ years by the central bank which is basically the same thing).

i would love to see a real debate between Schiff and Norman again... it would be priceless.

His critical thinking skills are about on par with a little kid who knows his parents are lying when they say they're broke, because he saw clearly that there were still two unopened boxes of checks in a kitchen drawer.

I think you are doing yourselves a disservice when you just type in "LOL Idiot MMTer." I have not seen any good reasons refuting Mike Norman's positions. There is a reason Schiff has been abysmally bad at short term projections. Austrian economics gets it right in the long run, but the long run can be a really long time. (BTW One thing Norman is very wrong about it that you can't have high inflation and high unemployment. You can certainly have stagflation like the 1970's)

RonPaulForums.com / LibertyForest.com is a grassroots web site with absolutely no official connection to Ron Paul or any election campaign. RonPaulForums.com / LibertyForest.com is privately owned and operated.